Articles on this Page
- 03/13/17--08:01: _A Croatian startup ...
- 03/13/17--13:51: _An under-the-radar ...
- 03/16/17--01:15: _A Berlin startup th...
- 03/18/17--10:38: _Early Uber and Pint...
- 03/21/17--00:38: _Two of DeepMind's c...
- 03/21/17--15:13: _A former investment...
- 03/22/17--01:23: _A VC fund that keep...
- 03/23/17--03:41: _Some London startup...
- 03/23/17--04:03: _The CEO of a period...
- 03/23/17--07:00: _This CEO was so bro...
- 03/23/17--10:05: _Europe's most valua...
- 03/23/17--12:45: _This ex-Googler wan...
- 03/24/17--08:30: _America's newest bi...
- 03/25/17--06:30: _This Austin-based s...
- 03/26/17--09:07: _Google has a plan t...
- 03/27/17--04:09: _One of SoundCloud's...
- 03/27/17--07:04: _'She's a fascist': ...
- 03/28/17--06:48: _Struggling electric...
- 03/29/17--01:06: _SoundCloud cofounde...
- 03/31/17--23:58: _32 British employee...
- 03/23/17--03:41: Some London startups say Brexit is already hurting their businesses
- 03/26/17--09:07: Google has a plan to engineer the next Silicon Valleys
- The Insider Story of BitTorrent's Bizarre Collapse
- How Technology Led a Hospital to Give a Patient 38 Times His Dosage
- The Internet Really Has Changed Everything. Here's Proof.
- An Exclusive Look at How AI and Machine Learning Work at Apple
- How the Web Became Unreadable
- 03/29/17--01:06: SoundCloud cofounder: London was 'crucial to our success'
LONDON — Imagine, for a second, that you run a delivery company. You need to make sure your fleet of couriers run as smoothly and efficiently as possible, without wasting time and taking the fastest routes between stops. The more efficiently operate, the more money you make. How do you do it?
This is what's known as the "Travelling Salesman Problem," and it's a famous problem in computer science.
But what if you realised that maximising the efficiency of your workforce meant that in the process you would unfairly distribute the work between your employees? If it risked causing resentment and bitterness, would you still do it?
That's a decision that Optimoroute, a Croatian route-optimisation company, forces its customers to make.
"We have a slider where you can adjust how sensitive you are to this fairness, we call it balancing," Optimoroute CEO Marin Šarić told Business Insider, "so you can decide for yourself how much this is an ethical issue for your business."
Optimoroute wants to make deliveries more efficient — and doctors, and repairmen, and more
Operating out of Zagreb, Croatia, Optimoroute provides back-end software to consumer-facing companies that have agents in the field. It has customers spread across 15 countries, including an Atlanta food delivery startup, a Saudi Arabian bakery, a London laundry-on-demand service, and air-conditioning and heating repair businesses.
The idea was first spawned in 2012, but all three of the cofounders didn't go full-time until 2015, and raised a previously unpublicised seed round in July 2016.
Investors include San Francisco VC firm Pathbreaker Ventures, London-based Hoxton Ventures, and the CEO of Yelp. Šarić declined to disclose the size of the round or the company's valuation, saying only that Optimoroute had "several million in offers" in the oversubscribed round but ultimately chose to take less than investors were offering.
Today, the company is still small, with less than 10 employees, almost all engineers — though it's continuing to hire. Marin claims it can work far faster than its competitors, recalculating complex routes on the fly as required, and can boost the efficiency of its customers by as much as 10%.
Route-planning has human complications
You can apply the Travelling Salesman Problem to just about any job with workers on the go, from doctors to delivery men — but there are varying human factors that need to be accounted for. A "salesman" might only be able to visit customers at very specific times. Or a company could need to avoid having its entire workforce clocking off on break at the same time. "These people are not robots, they need breaks,"Šarić said. Optimoroute "automatically calculates everyone's breaks so it minimally impacts the whole operation."
Plus there's the issue of fairness. If the most efficient route means one employee "just idles around most of the day and doesn't have to do anything ... it creates a huge management issue," the chief exec said. "It's a human issue. Those [other employees] will feel it's unfair."
It's led by a veteran ex-Googler
After university, Marin Šarić joined Google in Silicon Valley in 2003, "when it was legitimately a small startup." (Google formally launched in 1998.) He helped create the Google book search project and ran Google's library-scanning engineering team. His time at Google informed his ultimate approach to Optimoroute, which he cofounded with his brother Frane Šarić and Goran Kukolj: "What if I could take that experience and bring it back to Croatia?"
When raising venture capital, "I deliberately didn't want to talk to any emerging market investors,"Šarić said. "I wanted validation from the same people that I knew of or met when I was working in the middle of it [in Silicon Valley] ... I wanted those people to say 'wow, those people are fricking cool, we believe in you, we'll invest in you.'"
Rob Kniaz, another veteran Google employee-turned-investor at Hoxton Ventures, said: "When Marin was raising his first capital in California two other former Googlers, including one Hoxton fund investor, reached out to say we had to meet him en route back to Europe from the Valley. So we flew right out to Zagreb ... He bypassed typical London venture firms entirely."
Šarić says the company is currently "so close to profitability right now our runway is almost measured in decades," but that it intends to raise more venture capital to fund further growth, with an "85% chance we'll raise a Series A in 2017."
Šarić pitches the work Optimoroute does as more important than ever, given the changing face of work. "When people think about logistics, they think about routing, they think about package deliveries, they might think about some ships or freight crossing companies," he concludes. "But I think what people need really to understand is that we are moving towards this mobile world, where every every year, in every country, there are more and more people who are working on the go, and Optimoroute is in the middle of it all."
The Insider Picks team writes about stuff we think you'll like. Business Insider has affiliate partnerships, so we get a share of the revenue from your purchase.
At Insider Picks, we're dedicated to finding emerging brands with products that will add value to your life, whether it's a set of nice sheets for your bed, a pair of stylish computer glasses, or a hoodie that will last you a decade.
Linjer is one of them. With millions in sales after only a few years of operation, the leather-goods company has filled the demand for affordable luxury and is poised to become the industry's next breakout watch brand.
Launched in 2014 by Jennifer Chong and Roman Khan, Linjer was founded on the belief that shoppers shouldn't have to compromise quality for a good deal.
"We were fed up with having to choose between fast-fashion products that don't last and luxury-branded goods that are really expensive," Chong told Business Insider. "Many of us are left with little choice but to buy fast-fashion that is bad for the environment, bad for our wallets, and in many cases bad for the workers who make it."
Linjer launched its first Kickstarter campaign for bags two years ago. Not only did the campaign raise over $350,000, but Linjer made $1 million in sales in its first 14 months. 2016 was projected to be another banner year.
Chong and Khan recently expanded Linjer with a line of minimalist watches for men and women.
"We didn't want the experience of checking the time to be stressful, so we decided to make old-school analog watches to bring some 'analog peace' into our lives," Chong said.
Linjer spent 18 months perfecting two watch designs, and it paid off. The Minimalist and the Classic watches each come with vegetable-tanned leather straps, Swiss movements, and scratchproof sapphire crystals. Best of all, both retail for just $249.
The watches raised nearly $1 million on Kickstarter. Now the company is just trying to keep up with demand.
The Insider Picks team recently got the chance to try out Linjer's watches. Read our thoughts and see if you want to buy one for yourself.
Breton Fischetti, senior director, commerce:
The watch tried: Linjer The Minimalist Men's Watch, $249
It would be hard to think of a more simple but well-designed watch. The face is easy to read but still minimal, and having the date is a must for me, so I'm glad they included that feature. The leather band feels sturdy and well-made, and while not immediately soft, I get the feeling it's going to break in with consistent wear.
This is also the lightest watch I've worn in years. I can barely feel it while I'm wearing it. It feels like a great design and value for the price; you get everything you need and nothing you don't — plus it will look good in both formal and casual settings.
Ellen Hoffman, commerce editor:
The watch tried: Linjer The Classic Women's Watch, $249
I’m not a regular watch-wearer, mostly because I never found a watch I wanted to wear every day. But Linjer might turn me into one yet.
I value form more than function when it comes to watches (I always have my iPhone within arm's reach that I can check for the time); I see them as pieces of jewelry. To that end, I love the look of Linjer's watches. I got the "Classic" watch with a 34 mm face, rose gold case, and navy leather strap. Rose gold seems to be a real love-it-or-really-really-don't shade of gold, but I'm a big fan, and I'm excited it's an option Linjer offers. I'm also a big fan of this watch's thin band and smaller face; they give it a feminine touch. To echo Breton, this is also the lightest watch I've ever worn. I keep forgetting I’m wearing it.
Overall, it feels and looks a lot nicer than its $250 price suggests.
Tyler Lauletta, commerce reporter:
The watch tried:Linjer The Minimalist Men's Watch, $249
I've found that in most cases, at least for my taste, less is more when it comes to watches. That's why I'm really enjoying my watch from Linjer. It's extremely clean, the perfect weight, and looks great on my wrist. The leather strap is comfortable enough that it's easy to forget it's on my wrist at times. If you're looking to bring some simple sophistication to your watch collection, Linjer is a great option that doesn't break the bank.
Kelsey Mulvey, commerce reporter:
The watch tried: Linjer The Minimalist Women's Watch, $249
Writing for Insider Picks has turned me into a regular watch-wearer. While I still check my phone for the time, having a watch strapped on my wrist makes me feel more put together. All of Linjer's watches are free of logos, so you can easily dress them or down. The brand also lets you choose from three different sizes, so I went with a bigger watch face — not all watch brands give their customers as much autonomy.
Linjer's men's and women's watches all retail for $249, and they're available in a bunch of great colors and sizes.
Helpling, a Berlin startup that helps you get a cleaner on demand, announced on Thursday that it has raised a fresh €10 million (£9 million) funding round, bringing total investment in the company to €67 million (£59 million).
Founded in 2014, Helpling's platform allows you to open an app and request a cleaner on demand.
In January 2017, Helpling launched additional household services across 20 cities in Germany. The range of new services includes window cleaning, furniture assembling, paint work, and others.
The additional investment — led Asia Pacific Internet Group, which is a joint venture between company builder Rocket Internet and Qatar-based telco Ooredoo — will be used to roll out these services to all markets, including UK and Ireland.
Since launching, millions of household have been cleaned by cleaners booked through the Helpling platform, the Rocket Internet-backed company claims.
In July 2015, Helpling acquired London rival Hassle.com in a deal that was reportedly worth €32 million (£28 million).
Benedikt Franke, cofounder of Helpling, said in a statement: "Our core business model is on a clear path to profitability within the next year.
"The additional investment is an important step towards positioning Helpling as the hub for all home services, and to build an iconic consumer brand."
If you're interviewing for a job at a startup, you might be offered stock options. Sometimes, startups offer stock options instead of a higher salary.
It's not always easy to tell the true value of what you're being offered. And sometimes, what can sound like a lot of stock in a company can actually amount to very little.
"First, you should realize that when you're joining a startup, the likely outcome is nothing," Scott Belsky, a startup investor and entrepreneur, tells Business Insider. "But if you are sacrificing salary, you have a right to upside. And you also have a right to understand what your upside might be."
Belsky put early money into startups like Uber, Pinterest and Warby Parker. He also founded a company, Behance, that raised a few million dollars and was later acquired for about $150 million.
He says there's one question everyone should ask, that will give them insight into what stock option grants might be worth, before they accept a startup job.
"What you can do, when it's in the final stage of accepting an offer, is you can ask a simple question," he says.
"Based on the equity you're offering me, what would my stake be worth if the company were acquired for $200 million; for $500 million; for $1 billion?"
The answer might surprise you, and it depends on a number of factors, including how much money the startup has raised, and on what terms the money was raised on.
Belsky recalled a recent conversation with an entrepreneur who was exploring an acquisition offer from a "unicorn" startup — a private company with a valuation of $1 billion or more.
The founder was excited about it, until Belsky encouraged him to ask the simple question. The answer he got was so disappointing, it killed the deal.
"He said it was like an $85 million acquisition offer for a company that had raised basically seed funding," Belsky recalled in an interview for Business Insider's podcast, "Success! How I Did It."
"And he was really psyched about it. And he had not even asked these questions yet. I said to him, 'If you got your company acquired right now for $85 million in equity from this unicorn company, and you found out that they ended up exiting at the valuation they raised their last financing at, ask them like how much you would end up getting.' He ended up learning that it was basically nothing. And he didn't go through with it."
Check out the episode below for Belsky's career advice, and his advice for anyone looking to join a startup.
Here's a transcript from the portion of the interview where he offers advice for prospective startup employees:
Shontell: So, talk a little bit about what employees can do to realize what kind of a situation they're in when they join a startup. What questions should they be asking? What do they need to know about stock options? How do you know if — you know it sounds great when your company raises $50 million to $100-plus million, but what does that actually do to you?
Belsky: Sure. The two things that I think are important are one, is to realize that when you're joining a startup the likely outcome is nothing. And even if the company does OK and has an exit, if you're a later-stage employee, you should really be making sure that you get an experiential education that is extremely rewarding, first and foremost. But if you are sacrificing salary, you have a right to upside. And you also have a right to understand what your upside might be.
And so rather than suggest to every engineer or designer or anyone else out there to get copies of term sheets and look — I mean it's really hard to do all that stuff and to ask a million questions. You're probably not going to get far in the interview process if those are your questions. But what you can do, when it's in the final stage of accepting an offer, is you can ask a simple question. Based on the equity you're offering me, what would my stake be worth if the company were acquired for $200 million, for $500 million, for $1 billion? Just ask that question.
Your answer might be that if it's acquired for $200 million, your stake is worth zero. If it's acquired for $500 million, your stake is worth zero. And if it's acquired for $1 billion, your stake is worth $100,000. Or whatever. But at least that answer can give you some sense of really what's going on. And I think that's the company's obligation to at least give you some directional guidance on what the likely value of your equity would be in those circumstances, and those are the questions people should ask.
Shontell: And any negotiating tips if you do hear that what you're being offered is zero?
Belsky: Well I think that just having that knowledge allows you to say something like, "Well, if the company were to be acquired for $1 billion and my equity is worth zero, maybe my salary should be a little higher," right? So it's that kind of calculus. Recently an entrepreneur called me with an acquisition offer from one of these unicorn companies. And he said it was like an $85 million acquisition offer for a company that had raised basically seed funding. And he was really psyched about it.
And he had not even asked these questions yet. And when he did, because I said to him, if you got your company acquired right now for $85 million in equity from this unicorn company, and you found out that they ended up exiting at the valuation they raised their last financing at, ask them like how much you would end up getting. And he ended up learning that it was basically nothing. And he didn't go through with it. So, I think he could've negotiated a much larger acquisition price I think based on that. But he chose not to just proceed at all. I think these are the types of questions and they open up obviously the types of negotiating points you could pursue.
Shontell: Are companies obligated to tell you?
Belsky: I don't think they're obligated to. But then as a prospective employee, you can decide whether you want to work for them or not. And that's just part of the calculus.
Two of DeepMind's three cofounders are quietly forming a network of angel investors to back European startups, The Sunday Times reports.
CEO Demis Hassabis and head of applied artificial intelligence Mustafa Suleyman, who sold their artificial intelligence (AI) company to Google in 2014 for £400 million, are reportedly rounding up a cohort of "celebrity entrepreneurs" or "super angels" to back the next generation of startups across the continent.
The investment network will pool financial resources to back a wide range of startups, but there will be a particular focus on backing those focusing on "deep technology," according to The Sunday Times. The group will reportedly start investing later this year.
Following the Google acquisition, Hassabis and Suleyman have made personal angel investments in around half a dozen early-stage tech companies, according to CrunchBase.
They have, for example, backed men's clothing company Thread, music ticketing app Dice, and a healthcare startup called Babylon, which has developed a computer-powered GP.
Shane Legg, DeepMind's third cofounder appears to be less active on the investment circuit, with no investments listed on his Crunchbase page.
Suleyman and Hassabis get investment advice from Ian Osborne, who is a partner at strategic advisory firm Osborne & Partners, according to two Business Insider sources with knowledge of the situation. They also partner with him on a number of deals through a company called "MID" (Mustafa-Ian-Demis), according to a source.
The thirty-three-year old is an elusive figure who was reluctant to appear on a Wired list in 2012, where he was described as "a gatekeeper who advises political and business leaders on international affairs."
DeepMind has also made a number of investments on a company level since it was bought out.
The London-based firm has bought at least three tech startups. Two of DeepMind's acquisitions — Dark Blue Labs and Vision Factory— were Oxford University spinout companies focusing on machine learning and computer vision. The other, Hark, was an Imperial College London startup with an app that helps clinicians to manage their tasks.
DeepMind did not immediately respond to Business Insider's request for comment.
Miki Agrawal cofounded Thinx, an underwear start-up meant to replace feminine hygiene products, in 2011.
But according to recent reports in Racked and New York Magazine, Agrawal has stepped down from her role as CEO of the company amid allegations that she behaved inappropriately with her employees and created a workplace culture that ran counter to the startup's feminist marketing.
One former employee, Chelsea Leibow, has filed a complaint with the City of New York Commission on Human Rights, alleging that Agrawal "touched an employee’s breasts and asked her to expose them, routinely changed clothes in front of employees, and conducted meetings via videoconference while in bed, apparently unclothed,"according to New York Magazine.
The complaint also names the company's chief financial and chief operating officers.
In a statement to Business Insider, Thinx highlighted that the company had not been served with any official complaint or charge:
"Miki Agrawal is no longer CEO, and we are working to put new leadership and policies in place so we can continue to grow and thrive. To support this effort, we have hired an executive search firm to assist in the recruitment of a new CEO. We are also hiring a human resources executive and, in the interim, have engaged a human resources professional who is working in our offices to support our progress.
Related to Ms. Leibow’s allegations, THINX has not been served with a legal complaint or charge from any agency. When the issues were brought to our attention following Ms. Leibow's departure from THINX, the company commissioned an investigation that concluded the allegations had no legal merit. The company cannot comment further on these legal matters."
In a self-published post on Medium, Agrawal denied the allegations:
"The company commissioned a third party employment law firm to conduct extensive diligence on each allegation and they all came back false and without any merit. Thank you for the thousands of wonderful messages of support during this strange time, each one has meant a lot. To be crystal clear, I know I’m passionate and oft unruly in my ways (as a taboo breaker must be), but I have never, ever crossed the line in the inflammatory ways described. This is all I am going to say on this matter."
The complaint also alleges that Agrawal discussed other topics that reportedly made employees uncomfortable, such as the size and shape of coworkers' breasts and her own sexual experiences. Agrawal told New York Magazine that the sexual-harassment claims were "baseless" and had "absolutely no merit." Leibow was fired from Thinx in December, reportedly after several months of complaining about Agrawal's actions in the office.
"I can recall multiple occasions when I tried to be honest about salaries or employment policies," Leibow said to New York Magazine. Agrawal "would stew, treat you like s---, then pick a moment to blow up and tell you how ungrateful you are and how you should be thanking her for the opportunity, how dare you."
According to Racked, 10 of the company's 35 employees have left since January. The articles in both Racked and New York Magazine also say that the startup does not have a formal HR department and offers comparatively low pay and expensive health insurance to its employees (a $200 per month premium as the cheapest option). Employees claim that the company offered a parental leave policy of two weeks of full pay for the birthing parent, plus one week at half pay. The non-birthing parent would receive one week of full pay and one week of half pay.
"I remember one of my coworkers started crying," one source told Racked. "She said, you know, 'I love working here. I love working for women. But it hurts to know that I'm giving my whole life to Thinx basically, like I work all the time, but I can't even afford birth control. And what does that mean if we're at a feminist company and I can't afford to keep myself safe and protected?'"
Shortly after word got out that Agrawal would be stepping down from her role at Thinx (as well as Icon, a "pee-proof" underwear company she cofounded) she told staff that she would stay on as the company's "SHE-E-O," a title that she often uses to describe herself, Racked reported. Thinx's board of directors is reportedly looking for a "professional CEO" to take Agrawal's place.
In the Medium post, Agrawal responded to the Racked article, explaining why the company didn't have set policies in place for things like maternity leave and benefits:
"I didn't take time to think through it. We grew so quickly and I didn't hire an HR person (it was hard to rationalize hiring an HR person at the time with only 15 employees and then all of a sudden we were 30 people) ... All of a sudden, health insurance, vacation days, benefits and maternity leave were brought up (at the time we didn’t have any pregnant women on the team unlike now where we have 3, including me! :-)) and when you're a start-up and you’re growing and moving so fast (remember, we’ve only really hit this crazy growth period 18 months ago), to sit down and get an HR person and think about those things were left to the bottom of the pile of things to get done."
Venture capital firm Octopus Ventures has raised a £120 million fund to invest in UK technology startups, The Financial Times reports.
The London-based investment company, part of UK fund management firm Octopus Group, has reportedly now raised a total of £660 million, fuelled in part by a string of successful UK startup exits.
Natural language processing pioneer Evi Technologies, predictive keyboard startup SwiftKey, and AI video startup Magic Pony are all in the Octopus Ventures portfolio, as are companies like LoveFilm and property website Zoopla.
"Evi Technologies in Cambridge was sold to Amazon and now powers Alexa, the voice-activated speaker," Alex Macpherson, chief executive of Octopus Ventures, told the FT. "We also backed Swiftkey which went to Microsoft last year [for $250 million; £200 million] and made a seed investment in Magic Pony, which went to Twitter [for $150m; £120 million].
"We have expertise in the machine-learning field, but the challenge today is pretty much every business that comes through to us is machine learning or artificial intelligence."
LONDON — Brexit hasn't even happened yet, and some British startups say they're already feeling the negative effects.
One in 10 London tech firms say that investors have held off or withdrawn from a funding round after Britain's shock vote to leave the European Union, and a third say that it has made it harder for their businesses to grow, according to a new survey from Tech London Advocates.
The industry advocacy body surveyed 200 "senior figures within London's tech sector" about the impact Britain's planned departure from the EU is having, and found widespread negativity within the industry.
58.2% of respondents said that it will "damage London's position as a global tech hub," with 24.3% arguing the opposite — that it wouldn't have much impact.
Despite these concerns, however, 2016 was overall a record year for venture capital investment in Britain (even with the referendum halfway through), according to data included in a Tech City UK report published on Wednesday.
But the pessimism about Brexit is unsurprising. Before the June 2016 referendum, the UK tech industry overwhelmingly supported remaining part of the EU. In one poll, almost 90% of respondents were pro-Remain.
People in the industry have numerous concerns about the impact Brexit could have, from the availability of funding to access to European markets and to talent, with the London tech industry heavily reliant on foreign workers.
British Prime Minister Theresa May has indicated that when she triggers Article 50 — kickstarting the formal process of leaving the EU — on March 29, she intends to pursue a "hard Brexit." This would prioritise immigration control over tariff-free access to the European Single Market, a position that has little to assuage the tech sector's concerns.
There have, however, been some early votes of confidence in London's post-referendum tech sector. Facebook announced expansion plans in November 2016, saying it intended to hire 500 more people in London, while Google recommitted to plans to build a major new London HQ.
A survey published this week by KPMG (and conducted late last year) suggested that globally, Brexit has done little to dampen optimism about London's future as a major epicentre of tech, with more respondents than ever citing it as an "a leading technology innovation hub" for the industry.
But Tech London Advocates' survey suggests that on the ground, businesses are more worried.
NOW WATCH: 7 amazing technologies we'll see by 2030
BERLIN — Period tracking startup Clue has gained millions of users since it was founded in 2013. But there's one small problem: It doesn't actually make any money.
That's all going to change later this year, according to CEO, Ida Tin, who told Business Insider on Wednesday that her company will start generating revenue in the second quarter of 2017.
Speaking to Business Insider at the company's office in Kreuzberg, Berlin, Tin explained that Clue is running a number of revenue-generating "experiments" before deciding which ones to roll out more widely.
"We have a lot of experiments that we're starting to run now," said Tin, who has raised over $30 million (£24 million) from investors. "We don't know yet what will work and what won't work."
Tin referenced two types of revenue-generating options that Clue is currently looking at. The first involves a premium app that users would have to pay for and the second involves adverts.
"I would love it if we could essentially provide so much value to people around understanding their body that that's what people will pay for," she said. "So a very consumer facing, kind of premium subscription type thing."
When asked how much a premium version of the Clue app might cost, Tin said she wasn't sure right now and that the company is going through "that whole process" at the moment.
"I think we can also do something meaningful with helping people find really, really good products and services. So some kind of lead generation, revenue share or something. Hopefully executed in a way that will feel like a value add for users."
Tin said the she ultimately expects Clue to derive revenues from a number of different channels.
Tin added that she's using most of the venture capital funding to hire more staff. Clue currently employs around 50 people but that number is set to grow to over 80 in the next two years.
Today, programming software company Mashape announces a $18 million investment, led by famed Silicon Valley firm Andreesen Horowitz.
Andreessen Horowitz general partner Martin Casado, who cofounded networking startup Nicira before VMware gobbled it up in 2012 for $1.26 billion, will also join Mashape's board.
Today, Mashape is going strong, with 25 employees. And teams at companies like Amazon, Spotify, and Target are using Mashape's flagship Kong software to build their apps in more modern ways. Better yet, as of December 2016, Marietti says, Mashape is cash flow positive, after raising a relatively meager $8.1 million in venture funding over the years.
But before we go into what Mashape will do with this money, let's step back and look at how this company got here. It's a story of determination and dumb luck — even Casado says that one of the things he most admires about the Mashape founders is "the amount of sacrifice that they did" to get where they are today.
"You walk along a hard road as a company," says Mashape CEO Augusto Marietti.
Indeed, in a very real way, if it weren't for Uber CEO Travis Kalanick and Airbnb CEO Brian Chesky, the leaders of Silicon Valley's two most prominent startups, and a willingness to rough it out when they were broke, Mashape might not exist.
The Uber-Airbnb connection
It was 2009, and 18-year-olds Augusto Marietti and Marco Palladino had come from Milan to San Francisco's TechCrunch 50 conference with a demo of a website that could mash up data sources...and very little else.
An entrepreneur named Travis Kalanick (yes, the future Uber CEO) made the trip possible when he picked Marietti and Palladino from a crowd of 30 or so applicants to crash free of charge at his "Jampad"— his large San Francisco home, which doubled as a hangout and meeting spot for the local startup scene— for 10 days during the event.
"I don't know why he picked us, but he picked us," says Marietti.
The event didn't result in the funding they were looking for, but the Mashape team wasn't discouraged. Besides, they had made a powerful friend, which would come in handy later. They flew back and forth between Italy and San Francisco, hustling for funding.
At this point, they were teetering on broke. They ate rice and beans, took meetings at Starbucks, and shared the same bed in the cheap Airbnb rooms they found. Once, Marietti says, they ended up sleeping on benches in San Francisco's Dolores Park because they had nowhere else to stay.
Still, they had another fortuitous encounter when their Airbnb fandom resulted in them crashing at Airbnb's headquarters — which at the time was really just 8 guys sharing a house in San Francisco. There, Marietti got to watch Airbnb cofounders Brian Chesky and Joe Gebbia at work, internalizing their focus on building communities.
Chesky and Gebbia, too, acted as mentors for the young Mashape team. The biggest lesson Marietti learned from the Airbnb founders: A competitor can replicate your product's features. But if you have a dedicated community of users, well, that's "very, very hard to copy."
The real turning point would come in April of 2010, when Mashape finally found a group of early YouTube employees who might be willing to make a small investment. Kalanick offered the Jampad's living room as a meeting spot, and even sat on Marietti's side of the table during negotiations.
When one group of investors said they might be interested, but they needed to sleep on a decision, Kalanick pushed Marietti into taking a more hard-line stance, telling Marietti that "if they leave, you're never going to see them again."
Kalanick instead told the investors that they had five minutes to talk privately and make a decision, or else Mashape would walk away. A handshake deal was struck for a little over $100,000, and the Mashape team, which only had $2,000 in the bank at this point between then, was saved.
"That saved us, literally," Marietti says. "We wouldn't be here without Travis."
It was hard enough in 2010, Marietti says. Nowadays, he says, there are more and more startups vying for attention, and he's not confident they could do it again. "I probably wouldn't survive if I had to do it now," Marietti says.
So what does Mashape do?
Mashape is riding the wave that programmers call "microservices," where you take one big, monolithic, complex piece of software and break it down into multiple simple little ones. Those little bits then talk to each other via a method called APIs, or application programming interfaces.
With microservices, if you're trying to build a new website, mobile app, Amazon Alexa skill, or smart refrigerator, programmers can just build the vast majority of the software from the figurative Lego bricks they already have, rather than start over from scratch. It's an approach pioneered at companies like Amazon and PayPal.
Marietti describes this as a "shapeless" approach to software development, where the same code can be reused across platforms old and new. And he says that, as "elephants" among the Fortune 500 and their ilk start to accelerate their software strategies, they're turning to Kong to help them manage and secure their microservices architectures.
"They're the elephants going through a transition," says Marietti. "They have a very complex need."
That's why Marietti is raising the funding now, despite Mashape's recent turn towards profitability. He sees a big chance to build out Mashape's profile among big companies, positioning Kong as a big way to help them move into the future.
Bits into atoms
From the perspective of Andreessen Horowitz's Martin Casado, Mashape is playing into a bigger trend entirely.
To go back to Travis Kalanick, much of Uber's strategy hinges on the usage of APIs: When you hail an Uber via Google Maps, that's Google's code "talking" to Uber via an API. Similarly, when you use an Amazon Echo to play a Spotify song, Alexa "asks" Spotify for the song via API.
Now, Casado says, there are APIs that let you do everything from send text messages, to reserving warehouse space, to sending snail mail via USPS. It's not just apps and services that are being affected; it's the physical world.
"Any service that exists, there's a way to programmatically control it," Casado says.
So as software just keeps on eating the world, Casado says, there's going to be even more demand for software like Mashape's Kong, which can help company manage this exploding world of APIs. And as it is, he says, Kong is already the most popular software of its type out there. And, true to the lessons, that Marietti learned from Airbnb's founders, Kong has a thriving community of thousands of open source developers using it in their own projects
"I think now is the time to be bold because now is the time to disrupt the infrastructure," says Casado.
NOW WATCH: What happens when you eat too much protein
Enterprise software firm SAP announced a $35 million (£28 million) fund on Thursday that will be used to back promising early stage software companies.
SAP said the "SAP.iO fund" has been set up to support the existing SAP.iO programme, which is designed to get SAP employees and startups using SAP's data and application programming interfaces (APIs).
In addition to the new fund, SAP.iO has also launched its startup incubator programme in Berlin and San Francisco. The incubator programme, known as the SAP.iO Foundry, is already in operation in New York and Tel Aviv.
Deepak Krishnamurthy, chief strategy officer at SAP, said in a statement: "In addition to empowering our employee innovators, SAP.iO will use its fund and foundries to invest in entrepreneurs that develop industry-changing software."
SAP, headquartered in Walldorf, Germany, is the largest software company in Europe, with a market cap of $121 billion (£97 million).
Bill McDermott, CEO of SAP, said in a statement: "We have a message for entrepreneurs: if you have a bold dream to solve one of the world's most significant challenges, join us and let's chase your dream together."
In 2008, Bindu Reddy left her job as product lead on Google Apps — she was involved in the earliest planning stages of the search giant's ill-fated social networks, Google Buzz and Google+, but saw the writing on the wall.
"It was clear that Google was not evolving to be a social company," Reddy told Business Insider.
That was a problem for Reddy, who sees social media as a crucial mechanism for anyone, anywhere to have a voice. That's especially true during these politically turbulent times, she said, when social media is enabling people to speak up for what they believe in. Not to mention, having a personal brand can increase career opportunities.
The problem, as Reddy sees it, is that in its current form, social media can be overwhelming for anybody who's not a millennial power user. Given the ultimate power to say anything, people often find themselves speechless.
"For normal human beings, social media is always sort of difficult," said Reddy. But at the same time, "if you're not active, you'll get laughed at."
That's why, on Thursday, Reddy launched her new venture, Post Intelligence: A free artificial intelligence-powered personal assistant for social media, designed to turn anybody from zero to hero on Facebook (with Facebook Pages support to start) and Twitter, with more social network support likely coming down the line.
Post Intelligence is actually one of those famous Silicon Valley pivots: Back in 2010, Reddy and her team launched MyLikes, a platform for helping social media influencers and sponsored content publishers team up. That product gets rolled into Post Intelligence, and taken a step further.
Right off the top, Post Intelligence has some key features to help your posts do better: It can suggest times for your social media post to go up to be seen by the most people, as well as give it a score of how well it's likely to perform with your followers.
But Bindu says that there's a more existential problem that Post Intelligence is working to solve: "What do you want to expose to your friends?"
Everybody wants to establish themselves as an expert, or at least as someone with something insightful to say. The problem is that there's always too much going on in the world to even know where to start. That's why Post Intelligence also prompts you with news articles and tweets that are relevant to your interests — basically, things that act as conversation starters.
Combine the two, Reddy says, and you have a set of tools for establishing yourself as an expert in front of a broad audience. In the future, Reddy says, she sees Post Intelligence getting smarter, with better prompts and additional suggestions on how to make yourself into a viral social media superstar.
"There are things that people can do easily, but AI lets them go further and faster," Reddy says.
As for the business model, Post Intelligence is totally free: It uses some of that MyLikes pedigree to connect you with producers of sponsored posts, so once you have your audience, you can become a brand influencer, Kim Kardashian-style. And Post Intelligence takes a cut.
Earlier this month, Bay-Area-based startup Spin introduced the first large-scale deployment of a stationless bikesharing program in the US.
As of March 11, Austin, Texas now has hundreds of orange Spin bikes randomly scattered around the downtown area, each available for rent whenever and wherever Austinites need them.
Each bike pairs with a mobile app that electronically unlocks the bike for $1 per 30-minute trip.
Derrick Ko, a Spin co-founder, used to work for the ridesharing company Lyft, where he says he learned just how many people struggle with what's known as a "last-mile transportation problem."
Basically, people may find it easy to commute most of the way to work, but get snagged primarily within the last mile. In cities, Ko says, there are typically few options for people to travel that mile, short of walking or waiting in traffic.
If they had bikes right at their fingertips, Spin's mission suggests, life would be a little easier.
"What we're seeing is cities are getting extremely congested," Ko says. "And public transportation infrastructure is very inconsistent around the US, to put it mildly. As a result, people are depending on cars."
Spin's solution is to give people the ability to rent a bike where they currently are, not where the bikes live in a designated rack — the way traditional bikeshare programs work. Just like Zipcar does for people who need a car, Spin's app connects users to nearby bikes to rent them out for as long as they need.
Once they're finished — say, arriving at a friend's apartment — they can leave the bike up against a wall or beside a lamp post. There are no guarantees it'll be there when they leave, but another will likely be just as close by. (If someone wanted to take the bike outside city limits, technically they have that option, Ko says. But he says that is an outlier case.)
In the short term, the goal is to mobilize people without adding to the congestion that's already created by cars. In the longer term, Spin wants to transform how the US thinks about commuting — to take people from a car-centric mindset to one that prioritizes riding a cleaner and cheaper form of transit.
"It's really about converting car trips to bike trips," Ko says. "Every additional bike trip in place of a car trip will improve congestion; it'll improve health; and it'll improve pollution. And that to us is a great mark of our system working."
Changing Americans' preference for cars over bikes is kind of like asking them to prioritize Major League Soccer over the NFL, Ko admits. It's a real challenge.
"This is a completely new model," he says.
And launching a new model requires a number of precautions. Spin, for example, will be working with the Austin city government to educate citizens about the program, including telling people not to leave bikes in front of doorways or in places blocking pedestrian walkways.
There also is an on-the-ground task force that Spin has hired to enforce some of the policies. If people steal the bikes or misuse them, Spin will assemble a team that can investigate the problem. Ko says reports about China's stationless bikesharing program going totally awry are mostly sensational; save for a few bad apples, he doesn't expect the heaps of discarded bikes China has seen in a few rare cases.
If Austin proves successful, the company will look to expand to the Bay Area and other cities around the US.
"There's this sentiment that people don't like to own things, and bikes are definitely one of them," Ko says. "And thanks to ridesharing, people are very used to their mobile phone as their gateway to transportation."
When Uber unveiled its same-day delivery service, UberRush, it was supposed to be the FedEx killer, dominating local business deliveries and changing how businesses move goods around a city.
Two years later, UberRush is still only in the three cities it initially launched in, while a new name has been quietly growing around the rest of the country.
Dropoff, an Austin-based startup, has expanded into five different states and 12 cities in the last two years, CEO Sean Spector told Business Insider.
"There was no national brand for same-day delivery," Spector said.
So far, the company is largely expanding throughout the southern US in big (and car-friendly) cities like Miami to Houston to Los Angeles. While Uber has wanted to be that brand, its Rush business service has stagnated in Chicago, San Francisco, and New York.
Meanwhile, Dropoff has been encroaching on its turf. Spector says the startup is already profitable in its first few markets, and it counts Whole Foods, JW Marriott, and Neiman Marcus as customers who use its service.
While Dropoff does a lot of the traditional courier work that you'd expect of businesses, it's also focused specifically on attracting healthcare, grocery, and retail clients. Its "Agents," as it calls its contractors, do everything from deliver jewelry to a customer to set up catering for Whole Foods at an office. As healthcare shifts more to the home, Dropoff has trained its drivers in HIPAA compliance and started delivering medical supplies for a national client. When it comes to retail, Spector says the shift is inevitable over the next few years and it will be rare for a business to not have a deliver-that-day option.
"The majority of retailers will have to offer a same-day solution," Spector said. "Most are not wanting to build it themselves, and that’s what we want to be."
To attract the national clients it needs to beat the heavily-funded Uber, the startup built the Dropoff Tracker, which allows businesses of any size to see any of the deliveries it has going on in the system. That way, if a brand like Nordstrom wants to see how many deliveries are out at the moment, they can look at it on any level from national to regional to store-specific deliveries.
Spector thinks Dropoff is threading the needle between a FedEx that is great for speedy overnight deliveries and a service like UberRush that's more peer-to-peer delivery. Businesses are wanting the level of instant tracking that Uber has made ubiquitous, but they need professionalism on the other end, not a delivery driver who is pulling double duty as a courier, he said, citing a recent survey the company conducted.
"Those services are great for bringing me a burrito," he added.
Vu Van is a CEO in San Francisco. Born in Vietnam, she is a member of the auspicious class of Silicon Valley founders who are immigrants — among US startups valued above $1 billion, 51 percent have a foreign-born founder. Van earned her MBA at Stanford, locking herself into a network of hatchling executives. She had a pain point, realized that others shared her problem, and built a company to solve it. She debuted her app, Elsa Speak, at SXSW last year and promptly won an award. On paper, everything was Silicon Valley perfect.
Except that in every other way, Van doesn't fit the American startup mold. She's the only member of her company based in the US. She geared up to build her app, an AI assistant for English learners to improve their accents, by returning to Vietnam and immersing herself in the needs of her initial target users. Almost two years later, her seven employees are split between Vietnam and Portugal.
Van doesn't hesitate to call San Francisco home, but she also stays for a business reason, which is that the networking is second to none. "Vietnam is all about first-generation startups," Van explains. "Everyone is still figuring out what they're doing, and no one's in a good place to mentor." So she's planted herself in the one place on Earth where you can't do your dry cleaning without running into a potential advisor, expert, investor, or future hire. For her company, that edge makes the time zone patchwork worth the sacrifice of sleep and sanity.
So when Van first heard about Google's new Launchpad Accelerator, she was skeptical. The company was in effect promising mature startups from emerging markets the most epic networking service on the planet: For every hiccup Elsa was facing, Google would match her and two colleagues with a top expert — sometimes the top expert — in that area. For free, with no catch, no quid pro quo. Van decided to give it a shot. Despite her Bay Area bonafides, launching a product in Vietnam had still been a slog.
Elsa is one of the rising stars of The Rest of the World — and Google has a plan to get in the door of companies like Van's and shape them in its image. It wants to educate them on the best practices of product development and speed up their learning curves. Think of it as strategic philanthropy: In exchange for helping these companies grow, Google gets to scrutinize their books, observe how its own products are being used (or not) in less familiar markets, and spread its gospel to the far reaches of the globe. Eventually, these companies will play an enormous role in getting millions more people to conduct their lives online, and Google will be there as well, ready to scoop up new users.
"The one thing emerging markets are missing is success stories," says Roy Glasberg, Launchpad's global manager. "You need an ecosystem." A wiry Israeli sporting close-cropped hair and performance-wear chic, Glasberg is articulating an ideology percolating inside Google about why so few big companies emerge from outside Silicon Valley. He and his colleagues say the word "ecosystem" a lot.
It's a subtle, unstated way of contrasting the rich environment of the Bay Area, where investors, board members, competitors, and talented workers swirl in a self-pollinating bubble, with the relative deserts of countries such as Indonesia, Mexico, or even bigger players like Brazil. In the ecosystem view, the Bay Area is the goldilocks planet, and the rest of the world has the inhospitable climate of Mars or Mercury.
Google's theory is that until some company — any company! — has produced a massive IPO or engineered itself an eye-popping acquisition, a developing region won't amass the resources it needs to support entrepreneurship. Venture capitalists are uneasy, or simply absent. The talent pool is shallow, with few local technologists who have first-hand experience transforming small companies into large ones. When you wonder where to find a good data scientist, or how to negotiate better terms in your series A, or what to fix in your app to get a better conversion rate, no one around you has the answers.
So a delta force within Google, led by Glasberg, set out to see if it could do what countless governments, regional technology parks, and grant programs have failed to do before it: fire up startup kilns around the world that then take on a life of their own. They would do so by picking the sharpest, most proven startups, and showering them with unconditional support for six months (and $50,000, but who's counting) — essentially treating them as integrated wings of Google for the duration.
To earn that kind of access, these startups have to be much more than a Gucci knockoff. They're not just the Postmates of the Philippines, or the Tesla of Thailand. They are fiercely unique, tackling unsolved problems and producing code that rivals anything emerging from San Francisco or the South Bay. These are the brightest minds of elsewhere. And Google's now giving them a jolt of adrenaline straight from the planet's entrepreneurial mothership: itself.
Transporting the magic of Silicon Valley to other cities is a trope so old, and so beloved by government bureaucrats, that these days it hardly quickens the pulse. Silicon Alley. Silicon Glen. Silicon Wadi. Silicon Fen.
Seated at a small table in the brand new San Francisco offices of the Launchpad Accelerator, Glasberg explains why Google's approach is fundamentally different. "No one else is looking at emerging markets as a whole," he says.
Around him, a hundred-some entrepreneurs huddle in small group meetings with an elder statesman (or sometimes woman) of technology, or stare intently at their screens while seated elbow-to-elbow. We had to hunt to find two empty chairs, and eventually settled in between clusters of men leaning against low-slung cabinets, messenger bags strewn at their feet. The office hums with the low, persistent drone of voices.
Glasberg, who first joined Google in Tel Aviv after a career in business development, has been formulating his own global theory of startup victory. "When you have a few successful startups, they come back and start investing in their community, starting funds," Glasberg says. "You get a whole community boosting other startups." He starts ticking off countries. "You don't have that in Latin America. Brazil has never had a big exit. Argentina has had one." From an investor's point of view, he adds, startups "are already a risky business. So why should I go into a country that's never had an exit?"
The local venture capitalists who do take a stake in emerging market companies tend to push for a faster path to monetization than do the firms on Sand Hill Road, which in turn affects how a startup develops its products. (With more generous funding, entrepreneurs often feel free to chase after a riskier, higher-payoff goal.) Some investors may demand a bigger cut of the company. The startup's workers, meanwhile, are similarly circumspect about their employers, often requiring high salaries rather than agreeing to work for equity.
The problems don't end with investment. Without having played host to past startups that either IPO'd or got acquired, a country will be home to few — if any — entrepreneurs with first-hand experience of building a company from ten employees to hundreds or thousands, navigating that country's particular regulatory landscape, or overcoming the challenges that define many emerging markets, such as poor connectivity. In a word, they're missing expertise.
So in 2015, Glasberg started scheming how Google might throw its weight behind solving what seemed to be the core problem — the lack of success stories. They settled on a strategy: They'd identify the best companies and try to solve as many of their business challenges as they could in a two-week Bay Area immersion program, followed by six months of remote mentorship.
To have the most impact, Glasberg says, he and his collaborators decided they wanted more mature startups, whose products already have a healthy base of users. Often these companies are two or three years old, sometimes with 100 or more employees, and most of them have already raised a round or two of funding. Many of them are profitable. So rather than risk alienating the most promising companies, which might not want to give up any more slices of their equity, the Launchpad team decided that it would simply advise — and reap rewards for Google through other channels.
"The equity-free model lets us play the accelerator game further down the startup's evolution," explains Josh Yellin, a program manager on Glasberg's team. A former river ecologist, he joined Google in September 2015 to manage programming for the company's startup communities, before moving over to help build the nascent accelerator. While he was preparing for Launchpad's inaugural Winter 2016 class, the founders he talked to were at first confused by the word "accelerator," which usually applies to earlier-stage startups, when really he was targeting companies on the verge of rapid expansion. "We tossed around the word 'scale-a-rator,' but that sounds like some kind of animal no one would want to meet," Yellin recalls.
Last month, the third group of Launchpad inductees — three or so employees each from 31 companies out of nine countries — went through their two-week blitz at Google's Bay Area offices. Around 150 mentors also joined, many flying in from around the world to conduct deep, screen-by-screen code reviews, assess every app's design in minute detail, and pore over each company's hiring practices.
"We now have three classes of data of every mentorship session that happens. We have a note from every mentor of what came out of it — what was the challenge, and what was the solution recommended," Yellin says. Using all those reports, "we're basically creating a map of what makes startups successful around the world."
When they joined, the founders, many of them in their thirties, many of them armed with battle-tested self-assurance, were told they could name anyone among Google's almost 50,000 employees, and the company would broker an introduction. It wasn't hyperbole.
One founder and CEO, Reynazran Royono of Indonesia's Snapcart, came to Launchpad nagged by an AI problem his team hadn't solved. Snapcart users scan their receipts to earn cash-back rewards, but as the company grew to include 5,000 different grocery store chains and receipt formats, its engineers had stumbled into image recognition purgatory.
So he requested a session with an expert on Tensorflow, Google's widely used AI platform, and discovered that what he'd thought of as a mere annoyance was actually an open research question. "We talked to the Tensorflow guy, he said what we're trying to crack is very difficult and he wanted to help," Royono says. "But we'd get not just support from his team, but from the Google Brain guys, or the Ph.D. guys, to get help in cracking this problem."
A Brazilian startup called Portal Telemedicina, meanwhile, went straight for the crown jewels. It has built up a network of online doctors who can diagnose the scans and data generated by numerous clinics' medical devices, and it also relies heavily on AI. "We said, OK, I want to talk to the head of artificial intelligence at Google," says Rafael Figueroa, the company's founder and CEO. "They connected us with the guy in England, who, like, invented this stuff. He knows stuff that wasn't available online anywhere!"
The companies don't just get resolution to bugs, though, as if they're attending office hours back in college. The program is also built to spread startup best practices through hundreds of one-on-one sessions. For Van, the Vietnamese founder of Elsa, a prime goal was to steep two of her colleagues from Portugal in the Silicon Valley product development ethos: Iterate quickly, and don't be afraid to launch imperfect products.
In one meeting with a mentor, the team discussed how to solve some issues with its app's onboarding flow. They were noticing that new users were dropping out partway through the app's sign-up process, but they couldn't figure out how to plug the leak. Her mentor, a renowned user experience expert named Jacob Greenshpan, suggested she try implementing a specific change over the weekend and see what happens. She said she'd think about it, falling back into a pattern of methodical deliberation that often characterized her team's work. "And he said, 'No, this is your homework for Saturday.' So I said, 'OK. Fine.' And it worked! We got a 25 percent improvement," she marvels.
Van is the kind of entrepreneur who actually does her homework — who'll read the 100-page manual and pore over every online resource she can find. But on normal days, she's still effectively working alone. And her team can only absorb so many tech mantras from afar. Those limitations turn into the months-long headaches of, say, an imperfect onboarding experience.
What these entrepreneurs' stories suggest is there's an implicit exceptionalism to how we view successful startups. The usual story goes something like this: The right group of founders got together, built an outstanding piece of software, and, through their collective brilliance, managed to accrue thousands and then millions of users.
That framework is not wrong, exactly — but it underestimates the enormous boost these companies get by virtue of geography and timing. Silicon Valley startups are like plants in a nursery, kept out of the cold, bathed in sunlight, and lightly spritzed on a daily basis. Out in the wild they'd end up more scraggly, if they survive at all — so it's a good thing someone came around beforehand to build their cozy greenhouse.
But even as these companies from outside the Valley get help from Google, some of them are beginning to compete with it. Van, for example, recently hired an engineer with expertise in AI out from under Google's nose. Both Google and Amazon had made that engineer offers with significantly more money than Elsa could muster, Van says. But Elsa's mission, with its potential to have a strong social impact, resonated with the engineer, so she turned down the Americans' princely sums and moved from her home in Ukraine to join the team in Portugal.
Google, meanwhile, gains plenty from bringing these startups into its fold. To get accepted, the companies undergo a grueling review, opening their books fully to Google employees. What emerges are not only the financial and technical details of individual companies, but also a growing portrait of startup health in a dozen different trying environments.
Then there's the product evangelism that occurs throughout the program. It's no secret that Google has developed many platforms useful to startups — Firebase, Tensorflow, Google Cloud — and through Launchpad it's assembled a captive audience of stellar engineers to listen as its employees rhapsodize about their favorite tools. "If they get the best startups to use their products in an early stage, it's really hard to switch in the future, because the cost of switching is so high," Van says.
Glasberg takes a broader view. "Google gets two things out of this. One is really understanding what it takes to be a successful entrepreneur in emerging markets." The other is that they can observe, under a microscope, developers from all corners of the world using Google products — the ultimate feedback. "We see firsthand what is working and what is not," Glasberg says. "This is super critical, because these markets are the next billion. That's where the future is."
The present, however, remains stubbornly in the Bay Area. Van has just returned from another of her lightning trips to visit her team in Vietnam. But after each lap of the globe she always settles back into San Francisco, to drink from the firehose once more.
More from Backchannel:
Veteran SoundCloud employee David Noël is leaving the Berlin-based music streaming business.
Noël started as community manager and evangelist at SoundCloud in July 2009, before becoming VP of community and evangelist in August 2012. He became head of SoundCloud's internal communications and evangelist in January 2014.
His departure comes after reports suggested that SoundCloud, which has been valued at $700 million (£557 million) by investors, could be about to sell at a knockdown price, possibly leaving early shareholders with little to cash in.
SoundCloud— which has raised $298 million (£238 million), including around $70 million (£59 million) from Twitter, according to startup funding tracker Crunchbase — was in talks to sell for $1 billion (£800 million), according to a Bloomberg report last July. But that figure could now be as low as $250 million (£199 million), according to a Recode report this month.
A report in The Financial Times last week suggested that the founders of SoundCloud wouldn't "receive a penny" unless the company is sold for upwards of at least $200 million (£159 million). That's due to the preferred stock options taken out by venture capitalists each time they invested in the company. If the founders shares are worthless, then it's likely that shares owned by other SoundCloud employees will also be worthless.
A source with knowledge of Noël's departure told Business Insider that he performed many different roles during his tenure at SoundCloud, including building up various teams, and shaping the company culture.
Another source told Business Insider that Noël will be leaving the company by the end of Q1 to pursue his own startup.
SoundCloud started out as a free streaming service, which helped make it popular among new artists. It introduced advertisements in mid 2015 ahead of the launch of its subscription streaming service, which launched in March 2016 to compete with Spotify, Apple Music, and Amazon Music.
Caoimhe Keogan, SVP People, Place & Community at SoundCloud, sent the following message to employees, according to a source:
As many of you already know, David Noel will be leaving SoundCloud at the end of Q1 after almost 8 years with the company. Hired as SoundCloud's first Community Manager, David was one of our first seven employees. After spending his first 4+ years building our Community Team and acting as an external evangelist as our VP Community, David then turned his attention to a new challenge - that of internal communications and effective collaboration in our fast growing, multi-location company. As our Head of Internal Comms for the past 3 years, David has been a true carrier of our culture and along with his team has really had a dramatic impact on how communication and information flows across our org. He’ll be sorely missed, but his legacy lives on in so many of our cultural practices, from cameo’s to All-Hands.
David has always been actively involved in early stage and start-up businesses, especially in a mentoring capacity in the tech-scene and so it will come as no surprise he’s leaving to start his own thing. I’ll leave it David to share more about his plans in due course, but I know he’s going to be hugely successful playing to his strengths and using his accumulated years of experience from helping build this company - to help others.
With David’s departure we will be redistributing some of his responsibilities into other parts of the Workplace, Internal Comms and People teams.
I want to take this opportunity to say a huge thank you to David on behalf of everyone at SoundCloud. I’ve personally learned a ton from David during the time we’ve worked together. Thank you David for being one of those people who truly made a difference. Every day.
Paris tech investors and entrepreneurs are "scared to death" about the prospective election of Marine Le Pen, an extremist politician who has strong chances of becoming the next French president.
"She is a fascist," said a partner at one of France's leading venture capital firms, speaking to Business Insider. "It's very different from the populism you see in England, because she's absolutely anti-capitalist. She's a pure socialist — that way she's closer to fascism. It's xenophobia, plus socialism."
"I'm scared to death," the person added.
Marine Le Pen is often likened to US president Donald Trump or former UKIP leader Nigel Farage. She is the leader of France's Front National, an anti-immigration and anti-EU party which regards the racist BNP in the UK as its sister party.
Unlike Trump, however, Le Pen is anti-capitalist and this, along with her anti-immigration rhetoric, makes her a worrying candidate for France's tech industry. "She wants to get back to a state-owned economy," noted one venture capitalist.
"It's a real threat," said Loïc Le Meur, the founder of tech conference Le Web. Le Meur lives in San Francisco but votes in France, and is back in the country to promote his new Leade.rs conference. "It's the same risk as in the US."
Didier Rappaport, the CEO of dating app Happn, attributed Le Pen's rise to a "failure of politics".
"A large part of France does not like the way France is going," he said. "They have no choice but the extremes."
But he was more optimistic than his peers, saying she had "no chance of becoming president"— at least this time round.
If you took a walk around Paris, you'd have little idea that France was facing its own Trump moment, particularly given Le Pen's popularity.
Instead, there are posters dotted around for the tech industry's preferred candidate, the independent and pro-entrepreneur Emmanuel Macron. Macron has promised to slash taxes, something sources said often put foreign entrepreneurs and investors off France.
While Rappaport was optimistic for Macron's chances, others voiced doubts.
"95% of the tech industry is pro-Macron," said one VC. "But we live in a bubble."
Electric-car startup Faraday Future hit another speed bump in its nearly yearlong struggle to keep the lights on. The Southern California-based company announced it is scrapping plans to build a secondary facility in the San Francisco Bay Area.
The site, a naval shipyard on Mare Island in the city of Vallejo, was the subject of Faraday's plan to build a light industrial facility for manufacturing electric vehicles. The company entered an agreement with city officials in May last year that set forth terms for negotiations on the 157-acre site.
"Due to the new strategy to focus corporate efforts on development of its first production vehicle and plant in North Las Vegas, FF has decided to end its Exclusive Right to Negotiate (ERN) with the City of Vallejo," a Faraday spokesperson said in an emailed statement to Business Insider. The company indicated it would keep Vallejo on its radar for potential future opportunities.
According to the Vallejo Times-Herald, Faraday had been given two extensions on the negotiation contract with the city — once in December, and again some three months later — to see if the company was able to buy the property. Faraday's most-recent reprieve was a 45-day extension that it forfeited less than three weeks later, the newspaper reported.
Faraday Future, hamstrung in recent months by an ambitious agenda that was all but upended by a cash shortage and a mass exodus among its executive ranks, has sought to refocus its efforts — namely, finishing development of its production concept car, the FF91, and getting its main factory off the ground.
That main factory is expected to go up about 30 miles north of the Las Vegas Strip, though the construction site the company celebrated in April last year is still a vast empty lot in the middle of the Nevada desert. The company touts the vacant acreage as "phase 1" of the project, promising the next phases would begin "very soon."
It is unclear what Faraday's actual timelines are, even as the company claims to be receiving new reservations for the FF91 electric car — a tech-laden, crossover-style vehicle that was not yet ready for production as of its debut at the Consumer Electronics Show in Las Vegas this year.
Seen as a threat to Tesla at its inception, Faraday is primarily backed by tech billionaire Jia Yueting, the chief executive of the media and electronics conglomerate, LeEco. Jia's company has had its own money problems and mass layoffs in the last few months, which were followed by the rumored sale of a 49-acre property LeEco bought from Yahoo less than a year ago in Silicon Valley.
LeEco got a $2.2 billion investment from the property company Sunac China Holdings in January, but that money was earmarked for LeEco's entertainment business and not its languishing car upstarts.
BERLIN — SoundCloud is one of Europe's best known startups but the Berlin-based music streaming business wouldn't be where it is today if it wasn't for London, according to the company's cofounder, Eric Wahlforss.
SoundCloud was founded in the German capital in 2007 but the company, which had global ambitions from the start, was quick to expand, opening an office in London's Soho in 2008.
"We raised a seed round here [in Berlin] but very quickly, however, we started going to London on a regular basis," said Wahlforss at a UK trade mission event held Berlin on Monday.
"London was always the more established and the more professional hub," added Wahlforss. "It was where the capital was and still is to a large extent. And so that was incredibly important to us early on in the history of the company."
Wahlforss added: "I go there [London] regularly and it's a crucial place for us to be as a global platform."
SoundCloud has raised over has raised $298 million (£238 million) from a range of venture capital investors, including around $70 million (£59 million) from Twitter and an unknown amount (likely to be in the tens of millions) from investors in London, such as Index Ventures. More than 150 million pieces of content have been uploaded to its platform, including music from some of the world's biggest artists.
SoundCloud employs around 400 people in total. The majority of those are based at its headquarters in Berlin but the company also has around 100 staff in London and a sizable team in New York City.
While London is key to the company, Berlin is still where Wahlforss spends most of his time.
"It has this kind of punk vs tech, vs up and coming, sort of slightly left feel," said Wahlforss, who is also SoundCloud's chief product officer.
"Since the first time I came to Berlin 20 years ago now, in 1997, Berlin has come such a long way. It's now a global city. London has always been global and is probably the most global hub in Europe, but Berlin has become that global place as well.
"If I look back 10 years ago, Berlin was a nascent [startup] ecosystem. It didn’t have all of the infrastructure in place, but it had certainly some of the raw ingredients. I think London helped to bootstrap Berlin into the thriving ecosystem that it is today. And today I think it’s the fastest growing ecosystem."
One of the reasons that Berlin's startup ecosystem is growing fast is an increase in the amount of capital that's available to startups, according to Wahlforss.
Europe needs to come together to compete with 'innovation super powers'
Wahlforss went on to stress that European startup hubs should work together if they want to compete with the likes of Silicon Valley, while hinting that Brexit is a step in the wrong direction.
"Europe is really competing against the other innovation super powers in the world," he said. "Anything we can do to come together and double down on the strengths we have, then we should do that."
He added: "I appreciate it's very hard given the natural fragmentation that’s happening in Europe. But we should do that."
BERLIN — Fast-growing Berlin language startup Babbel employs around 450 employees from 39 countries.
Among Babbel's workforce are 32 Brits who are somewhat concerned about their future in Germany as a result of Brexit, according to Babbel CEO Markus Witte.
Leaving the EU could make it harder for Brits to work in countries like Germany and France. It could also make it harder for UK companies to hire people outside the UK.
Speaking to Business Insider at Babbel's office in Mitte, central Berlin, Witte said "at first they were very scared" before going on to add that they're slightly less concerned now that they know it will take a while for the impacts of Brexit to be realised.
"We still don't know what will actually happen," said Witte. "I think the UK has traditionally been a very, very open country to the world and I don't see the island locking itself in."
He added: "Even from a locked in Britain, they [British tech workers] will be able to relocate. It's not going to be North Korea."
When asked if Babbel would consider opening up a separate UK office to accommodate workers that couldn't easily move to Berlin, Witte said: "No, no we wouldn't. Especially not in London given London rent is just hilarious. This is probably the best location in Berlin you can get. Compared to a mediocre London office, it is dirt cheap."
He added: "I wouldn't open an office [in London] just for the talent. We're not at that size yet. As a Google you do that. We're not there yet. And probably will not be there in 2-3 years. Let's see. Any company under 10,000 employees doesn't need to do that."
German politicians want London startups to move to Berlin
Politicians in Germany are keen for Berlin to try and capitalise on the uncertain climate that Brexit has created.
Last July, a campaign led by Germany's Freie Demokraten (FDP), or the Free Democratic Party involved driving a van with a billboard through the heart of London's Tech City neighbourhood. The van's colourful billboard read: "Dear start-ups, Keep calm and move to Berlin." At the time, the FDP party said it expected "quite a number" of London startups to move to Berlin.
Christin Lindner, leader of the FDP party, told Business Insider: "Those who would like to enjoy the advantages of the EU are invited to come to Berlin and make the city even greater together with us. With the combination of liberal policy and smart minds from London, Berlin could be the next European startup hub."
Last August, Berlin's Senator for Economics, Technology and Research Cornelia Yzer sent hundreds of letters to British firms and travelled to London Fintech Week to lobby startup founders. She warned them that remaining in Britain after the country leaves the European Union will damage their businesses, and she promised that Berlin will provide resources that will help them relocate.
"Britain's vote to leave the European Union will severely affect your operations in the United Kingdom," the letter read. "Probably you will already check the feasibility to move your company right in the heart of the European Union."